A Transactional Approach to Employee Engagement

Today's professional relationships are governed by an increasingly short-term and transactional logic. That’s true for people of all ages. But for those of younger generations, they have never known it any other way. Segmented as a market from birth and armed with credit cards, millennials have been taught to think of themselves as customers in virtually every sphere. Even in their roles as students, given the high cost of education, many young people think of themselves as buying and consuming the learning services sold by schools.

When they arrive at the workplace, short-term transactional thinking can be second nature. They are still thinking like customers. Sometimes when I point this out to managers, they’ll say, “Yeah, well, they’re not paying us. We are paying them. So what currency do they bring to the transaction?”

Of course, you want to get more work and better work out of every one of the people on your team. For their part, your employees want to earn more of what they need and want. The best solution? Reframe your mindset in terms of transactional logic – both you and the employee have something you want, and something to offer. Stop “paying” your employees and start “buying” their results, one by one. The more you trade results for rewards, the more reliable you can count on their performance will be. The smaller the increments, the more effective it will be. “I had a manager who would always say to me, ‘What do you need from me?’” one young employee told me. “I’d always know she was going to get me back with, ‘Great. Here’s what I need from you.’ She did that with everybody. She knew I needed the money and went out of her way to help me make more money, which was really great of her.

The critical element when it comes to rewarding your employees based on performance is letting them know, explicitly, that rewards are tied to concrete actions within their own direct control. This might remind you of the old-fashioned pay scheme of piecework in which individuals are paid on an agreed-on amount for each defined unit of work they produce. The seamstress might be paid per stitch or per finished garment. The accountant might be paid per tax return prepared. And so on. The key to your success will be defining those measurable pieces of work and setting a price per piece.

Perhaps, if given the choice, many individuals would opt for a safe lifelong employment relationship with secure, long-term vesting rewards. The problem is that you won’t find anyone who actually believe that this is a real option in today’s world. Nowadays, it sounds like an absurd claim on its face – largely because it is. Therefore, most employees are concerned about all the rewards they might be able to extract from their immediate bosses in the short term. However, younger employees are also acutely aware that the compensation systems and language of their employers almost always revolve around the traditional elements of compensation and benefits; pay scales or salary, health care plans, 401ks, and the like. They often ask about traditional rewards because they are aware that employers only know how to talk about traditional rewards.

But the real performance drivers for many young employees are the short-term, special rewards you negotiate in exchange for their short-term above-and-beyond performance. A senior engineer shared this story with me: “One of the engineers on my team, a young lady who talked about little else but flextime and work-life balance, pretty much dropped everything for two months and lived here around the clock working on a killer deadline for me. Why? I arranged for her to take six weeks off, two unpaid, in a row after the project was finished. That was all it took. She was here around the clock for two months, then she disappeared for six weeks and came back happy as could be. The other two guys on that team? They just wanted a bonus check. They all want something different. But they all want something, and most of them are willing to work for it.”

The best approach to negotiate these special rewards in very small increments. You want to be able to say, “Okay. I’ll do that for you tomorrow if you do X for me today.” Work a particularly undesirable shift? Work longer hours? Work with a difficult team? Do some heavy lifting? Clean up some unpleasant mess? Then deliver the reward in question as soon as you possibly can. Immediate rewards are much more effective than those that require a wait, because they provide a greater sense of control and a higher level of reinforcement. Employees are likely to remember the precise details and context of the performance and are therefore more likely to make the connection the next time the desired performance is called for. Plus, they won’t spend time wondering whether their performance has been noted and appreciated, and they will therefore be less likely to lose the momentum generated by that short-term success.

That does not mean that everything is open to negotiation. You should be rock solid on your basic standards and requirements. What is not negotiable? What is essential? What is not acceptable? That’s your starting point. From there, take control of the ongoing negotiation and help your employees earn those special rewards they want so much. In the process, you’ll get so much more, and better, and faster work from them, one day at a time.

Bruce Tulgan is an adviser to business leaders all over the world and a sought-after keynote speaker and seminar leader. He is the founder and CEO of RainmakerThinking, Inc., a management research and training firm, as well as RainmakerThinking.Training, an online training company. Bruce is the best-selling author of numerous books including Not Everyone Gets a Trophy (Revised & Updated, 2016), Bridging the Soft Skills Gap (2015), The 27 Challenges Managers Face (2014), and It’s Okay to be the Boss (Revised & Updated, 2014). He has written for the New York Times, the Harvard Business Review, HR Magazine, Training Magazine, and the Huffington Post. Bruce can be reached by e-mail at brucet@rainmakerthinking.com, you can follow him on Twitter @BruceTulgan, or visit his website www.rainmakerthinking.com.